There Are No Crypto Experts Yet, Market "Is Cyclical", Blockchain Enterpreneur Says

  • Investors are now more skilled at identifying legitimate blockchain projects, CoinList CEO Andy Bromberg said.
  • Cryptocurrency prices are "cyclical" and the market will recover, according to Bromberg.

Andy Bromberg, the founder and co-founder and president of CoinList, a crypto and initial coin offerings (ICO) “spin-off” of AngelList, recently told Bloomberg there is now a clearer “bifurcation” between “low-quality” blockchain projects and “high-quality” ones.

Bromberg noted that investors are getting better at evaluating, or assessing, the legitimacy of cryptocurrency startups. Due partly to the extended digital currency bear market, the CoinList president revealed it has become a lot harder to get attention from investors.

$15 Billion Raised By ICOs

When questioned about whether investors are still as interested in CoinList’s services, which include conducting anti-money laundering (AML) and know-your-customer (KYC) checks for clients, Bromberg said there is even more demand for crypto-related products in 2018 than when digital currency prices skyrocketed last year.

The former research associate at GGV Capital, a California-based venture capital firm with $3.8 billion of assets under management, revealed that this year ICOs have collectively raised over $15 billion, which is already over twice as much as the nearly $7 billion they netted in 2017.

Commenting on the reasons behind why blockchain startups have managed to acquire significantly more capital, Bromberg said: 

there are now different types of [crypto] tokens emerging, different types of categories that are going to start to make real sorts of gains in the space.

Andy Bromberg

"High-Quality" Blockchain Projects

Responding to why the cryptocurrency market needs “so many tokens”, which has been heavily criticized by prominent financial blogger Wolf Richter, Bromberg said the industry does not need nearly as many digital coins currently being circulated.

However, “what we’re seeing this year” is the tokens behind high-quality crypto projects are making substantial gains, even though last month saw ICO projects drawing the lowest amount of investments since 2016, Bromberg noted.

Bromberg added: “the high-quality [blockchain] projects are [currently] raising just as much [capital] as they were before, but the low-quality ones” aren’t performing as well, so they are “not contributing to that total.”

Reflecting on the highly volatile nature of digital asset prices, and the “massive spikes” their market has seen over its short history, Bromberg said the concerns, or fear, about cryptos going away are unwarranted.

309 Bitcoin Obituaries 

He went on to point out that bitcoin (BTC) has crashed so many times, however, the flagship cryptocurrency’s price has always managed to recover, and appreciate significantly afterwards. In fact, bitcoin has now “died” 309 times according to numerous inaccurate predictions from analysts during the course of its relatively brief (almost) 10 year history.

Putting things into perspective, Bromberg believes the cryptocurrency market “is going to be cyclical for a long time.” However, the blockchain industry will see more “stability” because “people understand [its] market better” now.

Interestingly, Bromberg admitted there’s no “expert” in the crypto or ICO space as the industry itself is in its very early stages of development. Most of the competent blockchain project analysts only have a strong background in game theory and economics, as these areas appear to have many similarities with the business models pitched by ICOs, Bromberg noted.